The dollar and
U.S. government debt yields jumped on Friday as a strong American labor
market report raised expectations that the Federal Reserve will increase
interest rates by mid-year.
Wall Street initially
rose and European equities hit a seven-year high on the Labor Department
report that showed solid U.S. job growth, with wages rebounding
strongly. More than one million jobs have been created over the past
three months, the first time that has happened since late 1997.
But U.S. stocks sold off in the afternoon on renewed jitters over Greece as a deadline looms next week for the newly elected government to secure a bailout extension.
"There's more loggerheads coming out of the Greece negotiations," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama. "The negotiations on the Greek debt weighed in on the market this afternoon."
Oil futures bounced up from near-six-year lows, but gold XAU= fell more than 2 percent and spot silver XAG= slid 3.7 percent. U.S. Treasury yields rose and the yield curve flattened as traders increased bets the Fed will raise rates by mid-year.
The
better-than-expected labor report added to expectations the Fed will
begin to raise near-zero interest rates around the start of summer and
slammed rate-sensitive securities.
Real estate stocks and the utilities sector .SPLRCU led the decline as their higher yields lose appeal in a rising rate environment, while financials .SPSY gained as they stand to see an increase in profits from higher rates.
Utilities fell 4.13 percent, the biggest single-day drop since August 2011, and financials rose 0.73 percent. One of the biggest percentage losers in the S&P 500 was Simon Properties Group (SPG.N), which lost 4.0 percent.
The Dow Jones industrial average .DJI fell 60.59 points, or 0.34 percent, to 17,824.29. The S&P 500 .SPX lost 7.05 points, or 0.34 percent, to 2,055.47 and the Nasdaq Composite .IXIC shed 20.70 points, or 0.43 percent, to close at 4,744.40.
In Europe, the FTSEurofirst 300 index .FTEU3 of top regional shares rose 0.2 percent to close at 1,490.84. But markets in Britain, Germany, France and Italy all fell on mixed earnings reports and worries about Greek debt negotiations, which put an early damper on global equity gauges.
But U.S. stocks sold off in the afternoon on renewed jitters over Greece as a deadline looms next week for the newly elected government to secure a bailout extension.
"There's more loggerheads coming out of the Greece negotiations," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama. "The negotiations on the Greek debt weighed in on the market this afternoon."
Oil futures bounced up from near-six-year lows, but gold XAU= fell more than 2 percent and spot silver XAG= slid 3.7 percent. U.S. Treasury yields rose and the yield curve flattened as traders increased bets the Fed will raise rates by mid-year.
Real estate stocks and the utilities sector .SPLRCU led the decline as their higher yields lose appeal in a rising rate environment, while financials .SPSY gained as they stand to see an increase in profits from higher rates.
Utilities fell 4.13 percent, the biggest single-day drop since August 2011, and financials rose 0.73 percent. One of the biggest percentage losers in the S&P 500 was Simon Properties Group (SPG.N), which lost 4.0 percent.
The Dow Jones industrial average .DJI fell 60.59 points, or 0.34 percent, to 17,824.29. The S&P 500 .SPX lost 7.05 points, or 0.34 percent, to 2,055.47 and the Nasdaq Composite .IXIC shed 20.70 points, or 0.43 percent, to close at 4,744.40.
In Europe, the FTSEurofirst 300 index .FTEU3 of top regional shares rose 0.2 percent to close at 1,490.84. But markets in Britain, Germany, France and Italy all fell on mixed earnings reports and worries about Greek debt negotiations, which put an early damper on global equity gauges.
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